Why location matters in real estate

Here are five characteristics to look for when buying a home.

By MSN Real Estate partner Oct 17, 2013 5:37AM

© Justin Horrocks/Getty ImagesBy Brendon DeSimone, Zillow

 

ZillowAsk just about any real estate agent to list the three most important things a property should have, and you’ll likely hear: “location, location, location.” That phrase has been in use at least since 1926, according to The New York Times, and is just as relevant now as it was then.

 

But why does location matter so much? For starters, you can’t move a home — at least not easily or inexpensively. When you buy a home in a good location, it’s usually a solid long-term investment.

 

Real estate agents often advise their clients to buy the worst house — a property that could use some TLC — on the best block. Why? Because fixing up a home in a great neighborhood will give you the best return on your investment. Quite simply, it will be easier to sell later on. Conversely, you can buy a beautiful home that doesn’t need any work. But if the block is sketchy or just plain bad, you could have a hard time selling the property at a decent price.

 

So if “location, location, location” is so important, what makes a location good? Here are five characteristics to look for when buying a home. If you can get all five, chances are the home’s a great investment.

 

1. A safe neighborhood
People want to live where there’s little or no crime. Naturally, they want to feel safe in their homes and will pay extra for it. A safe neighborhood means people will feel free to walk around, be outdoors and interact with their neighbors. Communities still exist today where people don’t lock their doors, and they know their neighbors are there for them in a pinch.

 

2. Good schools
Being in a good school district is important, even if you don’t have school-age kids and never plan to have any. Fact is, young families always will be buying their first or second homes. They will do their home search based on location in general and good school districts in particular. The better the school district, the higher the values of the surrounding homes can be.

 

Found a home you love but the school district is subpar? Be aware of that issue for resale down the road. Bottom line: When you buy a home, you should always think like a future seller.

 

3. Convenient access to popular places, shops and restaurants
Everyone wants to be near the best commercial districts. The closer to the hubbub of a particular town or the best parts of a city, the better the location — and the more someone is willing to pay for a home. In beach communities, the closer to the beach, the more valuable the property.

 

4. Water access and views
No matter which town or city, someone will always pay for a great view or to be on or near the water. Put a home right on a waterway or on a hill with panoramic views and you’ve got a great location.

 

5. Access to public transit and/or freeways
In major cities, the farther you live from the bus, subway or other types of mass transit, the less valuable the home. A good location means being very close, and having easy access, to public transportation. Being near a train or bus can get you anywhere in a short amount of time. In some towns, where a commute by car is inevitable, easy access to the freeway makes for a good location. Adding 20 minutes to a commute just to get to the freeway never helps a location.

 

What makes a bad location?
There are some common characteristics that make a location “bad,” no matter where you are.

 

Ever see a home with a backyard that faces the freeway? Whether the home is in Denver, Dallas or Dubuque, such a location is likely always going to be considered undesirable. Is the home on a busy intersection or a four-lane road? Again, it’s probably considered a bad location, no matter which town it’s in or what the nearby neighborhood is like.

 

Other factors that can make for a “bad” location: very close proximity to a fire station (good if your house is on fire, not so good if you’re trying to sleep); a hospital (frequent ambulance sirens); an airport (sounds of jet engines 18 hours per day) or a school (traffic from buses or parents dropping off children or kids yelling and playing).

 

Some “good” and “bad” qualities simply vary by community. If you know your local community, you know which parts of town are less or more desirable. It’s always smart to rent in a new community before committing to a home purchase. Renting allows you time to become familiar with the location.

 

All these things matter when you’re considering the location of a home for sale. But never lose sight of what matters most to you about the location. If you’re crazy about baseball, for instance, you might love owning a condo near your city’s professional baseball team ballpark. Someone who doesn’t like baseball, on the other hand, would probably not want to live near all the commotion.

 

Location, location, location really does matter — a lot. But as always, the most important thing is to buy the right home for you, at the right time.

 

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15Comments
Oct 20, 2013 10:06AM
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Water access & views are great if you don't mind the occasional flash flood or hurricane. Ask the people who had these views after Hurricane Sandy paid a visit.

 

For a few years I lived in a small NC town. There was a small creek, usually dry, that flooded big time during Hurricane Floyd. The water was up to the first floors of all the condos there.

Oct 18, 2013 6:22AM
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The Hamptons, The Hamptons, The Hamptons.
Oct 18, 2013 5:12AM
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You live where you can afford to live, any house is better than no house......
Oct 18, 2013 4:37AM
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Living next to a fire station isn't all that bad.  I'm down the street from one and fire trucks only pass by occasionally.  It certainly isn't a daily occurrence to make it bothersome.  I love the peace of mind knowing the fire department is that close at hand.

OTOH, a bad smell in the air is an excellent clue the location is bad.  Such as a highly industrial area (diesel fumes), oil refinery, chemical plants, steel factories and more.

Oct 18, 2013 4:01AM
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I live on a highway, but I like it.  It's fun to sit out front with a few beers and watch traffic or people walking past.  When I want a bit more quiet, I can sit in my 6-foot high cedar-fenced backyard with the big red maple tree.  Best of both worlds.  Plus, my road is the first to be plowed so I can always get to work without waiting.
Oct 18, 2013 3:56AM
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"Communities still exist today where people don’t lock their doors"

Yeah, and those people are sitting ducks because EVERYONE knows they don't lock their doors...so then you get to someday read stories about how a kid was taken from their bedroom and found dead in a creek or a family was murdered in their sleep and the news is filled with neighbors who are so "shocked" because "we never lock our doors".  I lock my doors--if someone wants in, it will be a challenge and they're gonna have to make some noise.

Oct 17, 2013 6:37PM
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I live next to the pump station.  Sometimes the smell of sh*t is pretty bad.
Oct 17, 2013 4:24PM
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I live between two schools, a high school (Francis Lewis) and a college building (St Johns), and right off the expressway (Long Island Expy). The buses and parents aren't the problem. The parking is the problem. During the day, I can't leave, because if I do, there will be no parking when I get back. The noise from the highway never bothered me. Its part of city life.
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